Surprise! Insurance Rebate May Stall In Employers Hands

Who would have thought that this could happen? Considering that Obamacare is well over 2,000 pages, written by all manners of different people and industries, and wasn’t read by anyone who voted “Aye”, it’s really surprising that there could be so many bugs (some intentional, many not) with the law. Like this surely unintentional bug

(NY Times) It was the great health insurance giveback: $1.1 billion in premiums returned to policyholders under the Affordable Care Act. But while many people who buy their own insurance found a check in the mail last week, millions insured through employers are still wondering what is happening with the money.

Workers were notified in form letters from insurers this month that a “rebate” had been sent to their employer, who “must follow certain rules in distributing the rebate to you.” But even when employees paid a significant share of the premium, many employers are still deciding how, when or even whether to share the cash.

And when government writes rules, things tend to get a bit wonky. And can be unclear.

The law gives employers up to three months and considerable discretion to decide how to spend the employees’ money, so long as it is eventually used to benefit insurance plan participants. And while some employers are returning the money directly in paychecks, or planning “premium holidays” that increase take-home pay, others are weighing different options, benefits consultants said, like reducing next year’s premium, or spending the refund on so-called wellness programs that reward workers who lose weight orquit smoking.

Which is apparently completely legal within the framework of Obamacare. Let’s also remember that Obamacare makes a big push for wellness programs. And there’s nothing wrong with reducing next years premiums, which could be the last year that insurance is offered through your company, as the Mandate is scheduled to kick in in 2014, as are the fines.

Now, let’s not put all the burden of blame on Obamacare, because some companies may simply be sitting on the money, but, then, they tend to pay the majority of the premium for their employees. Where’s their rebate? What we have here is “good intentions” from the Central Government Planners, and we all know what happens along the good intentions road.